Fiscal Procedures Manual SECTION 12: PROCUREMENT CARDS Section Contents Page # What's New?...12-2 General Information...12-2 Board Policy...12-2 What is the Procurement Card?...12-3 Cardholder Eligibility...12-3 Responsibilities of Program Participants...12-3 Cardholder...12-3 Budget Manager...12-4 Procurement Card Specialist...12-4 Campus/Department Generic Procurement Cards...12-5 Transaction Controls...12-5 Merchant Category Codes (MCC)/Restricted Vendors...12-6 Procurement Card Maintenance and Closure...12-6 Fund Sources Allowed for Card Purchases...12-6 Prohibited/Improper Purchases...12-7 Submitting Appropriate Supporting Documentation...12-8 Receipts/Proof of Purchase...12-8 Staff Development Meetings...12-8 Staff Appreciation...12-8 Other Supporting Documentation...12-8 Checking and Verifying Card Balance... 12-9 Monthly Reconciliation and Submission of Monthly Statement...12-9 Compliance...12-9 Monitoring...12-9 Audit...12-9 Procurement Card Protection...12-9 Page 12-1
Section 12: Procurement Cards Security and Storage...12-9 Lost, Stolen, or Damaged Procurement Cards... 12-10 Erroneous Declines... 12-10 Returns and Credits... 12-10 Disputes and Billing Errors... 12-10 Sales and Use Tax... 12-10 Exhibits... 12-11 What s New? Single Transaction Limit (Standard Min. $500) Monthly Transaction Limit (Standard Min. $3,000 per department) Daily Transaction Limit (Standard Min. $1,000) Procurement Card Credit Increases Due to EDGAR Guidelines, there will be designated credit cards for use with Federal Funds All forms referenced in this section can be located at GPISD Home Page-Departments-Business Services Business Services Forms or https://galenaparkisd.com/page/6535 General Information The Galena Park ISD Procurement Card Program has been established through Bank of America and is designed to be a more efficient, cost-effective method of purchasing and paying for small dollar transactions as well as high volume, repetitive purchases. The Procurement Card was designed as an alternative to the traditional purchasing process (purchase orders) for supplies, materials and equipment. The Procurement Card can be used, subject to Galena Park ISD guidelines, with any approved and/or allowed vendor that accepts MasterCard as a form of payment. The Procurement Card Program has been expanded to include a Travel Card. Refer to Section 6: Employee Travel and Section 7: Student Travel for more information. The success of the Procurement Card Program and its continuing use depends on your participation and cooperation. Please be sure to read and follow the program guidelines as specified within this manual. Board Policy The following Board Policy should be referenced for additional information associated with this section of the manual: Policy Code CFB (LOCAL) CH (LEGAL, LOCAL) CHF (LEGAL) Title: Subtitle Accounting: Inventories Purchasing and Acquisition Purchasing and Acquisition: Payment Procedures Page 12-2
Fiscal Procedures Manual What is the Procurement Card? Procurement Cards are issued to employees in their name or in a campus/department s name and has Galena Park Independent School District clearly indicated on the card. Cards issued to a campus/department may be used by approved employees from that location using the Procurement Card Log (Exhibit 12-01). Receipts and supporting documentation must be returned to the Budget Manager or Financial Clerk responsible for the card immediately after use of card. Cardholder Eligibility The Procurement Card is designed for permanent District employees who purchase goods or services on behalf of the District. Eligible cardholders may obtain a Procurement Card issued in their name by completing Procurement Card Training and the Procurement Card Agreement (Exhibit 12-02). By signing this agreement, you indicate that you understand the intent of the Procurement Card Program, and will comply with all guidelines of the Fiscal Procedures Manual as well as District Policies and Procedures relating to the expenditure of District funds. Any employee placed on administrative leave or under investigation for violating District Policy will have Procurement Card privileges revoked. Volunteers and students are not allowed to possess or use the Procurement Card at any time. Responsibilities of Program Participants Prudent and good business judgment must be exercised at all times when making a purchase with a District Procurement Card. Cardholders are expected to be as conscientious with District funds as they would with their own. Before any purchase is made, the Cardholder should ask: How will this transaction be perceived by the public we serve? Any purchase perceived as being excessive, exorbitant or inconsistent with educational business purposes will be scrutinized, and if deemed inappropriate, the Cardholder will be required to compensate the District from their personal funds. Misuse of the card will subject Cardholder to disciplinary action in accordance with District Policies and Procedures. For spending guidelines, please refer to Exhibit 4-14. Failure to comply with any of the listed items below may result in revocation of Procurement Card privileges. Cardholder Responsibilities include the following: Complying with District Policies and Procedures and Procurement Card guidelines Securing the Procurement Card at all times Immediately reporting lost, stolen or damaged cards to the Procurement Card Specialist o If after hours contact Bank of America Customer Service at (888) 449-2273 Return the Procurement Card to the Procurement Card Specialist upon terminating employment with the District or transferring Departments within GPISD The Budget Manager and/or Financial Clerk is responsible for anyone they allow to use the campus/department generic Procurement Card Ensuring that funds are available in the correct budget account before purchases are made Ensuring the vendor used is an allowed/approved vendor of the District Page 12-3
Section 12: Procurement Cards Ensure the Procurement Card is used for legitimate educational business purposes only Making purchases and/or returns Informing vendor of tax-exempt status Obtaining detailed sales receipts or other proof-of-purchase records for all transactions Ensuring purchased goods and materials are received Resolving billing errors and disputes with the vendor Do not accept cash in lieu of a credit to the Procurement Card account Report erroneous purchases to the Procurement Card Specialist as soon as possible Uploading the detailed receipt, agenda, and sign-in sheet (if applicable), along with any other supporting documentation into Bank of America Works within 7 business days of the purchase date Reviewing and validating all charges/credits appearing on the Procurement Card statement Ensure that an appropriate credit for the reported disputed item or billing error appears on a subsequent Cardholder statement Match detailed receipts with the Procurement Card statement Submitting original receipts with statement on a monthly basis to the Procurement Card Specialist Continuous compliance issues will result in permanent loss of Procurement Card privileges Budget Manager Responsibilities include the following: Complying with District Policies and Procedures and Procurement Card guidelines Ensure the Procurement Card Specialist is made aware of lost or stolen cards Requesting Procurement Card Specialist to cancel a Cardholder s card (e.g. terminated employees, transferring departments, and loss of Procurement Card privileges) Collecting canceled cards from Cardholders and forwarding to Procurement Card Specialist The Budget Manager and/or Financial Clerk is responsible for anyone they allow to use the campus/department generic Procurement Card Ensure the Procurement Card is used for legitimate educational business purposes only Attempting to resolve any disputes with vendor and/or Bank of America not resolved by Cardholder Notifying Procurement Card Specialist of any unresolved disputes, noting the reason for dispute Review transactions in Bank of America Works and submit for final approval within 14 business days of the purchase date Continuous compliance issues will result in permanent loss of Procurement Card privileges Procurement Card Specialist The Procurement Card Specialist is responsible for the overall Procurement Card Program. Responsibilities include the following: Galena Park ISD liaison with Bank of America Training Cardholders and Budget Managers before releasing Procurement Cards Having Cardholder sign Procurement Card Agreement (Exhibit 12-02), signifying agreement with the terms of the Procurement Card Program Page 12-4
Fiscal Procedures Manual Assisting the Budget Manager and/or Financial Clerk with erroneous declines and emergency transactions Securing revoked Procurement Cards and submitting information to Bank of America Ensure maintenance of certain documentation concerning the Procurement Card Program. This includes, but is not limited to, Procurement Card Agreement, billing statements, reconciliation of accounting statements, and correspondence with Bank of America Assist in answering questions and ensuring compliance with District Policies and Procedures Reviewing all Procurement Card transactions in Bank of America Works for accuracy and adherence to the District Policies and Procedures Reconcile the monthly statements and contact Cardholders, as necessary, to resolve discrepancies and/or disputed charges Campus/Department Generic Procurement Cards Any employee that checks out a campus/department generic Procurement Card must comply with all guidelines of the Fiscal Procedures Manual as well as District Policies and Procedures relating to the expenditure of District funds. Procedures for using Campus/Department Generic Card: 1. The Financial Clerk must use the Procurement Card Log to sign in/out generic Procurement Cards. 2. The PIN number should be provided to the card user. 3. The card user must return the card, receipts, and supporting documents immediately after use to the Budget Manager or Financial Clerk responsible for the card. 4. The Financial Clerk is responsible for scanning and submitting all receipts into Bank of America Works. Transaction Controls Controls have been established to limit certain purchases and dollar amounts charged to the card. These transaction limits may vary for each Cardholder and will be established by the Procurement Card Specialist and the Senior Director for Business Services. Single Transaction Limit (Standard Min. $500)*: Maximum total amount for each purchase on the individual Procurement Card. Each transaction may be comprised of multiple items, but the total cannot exceed the single transaction dollar limit on the Procurement Card. Do not split transactions into smaller amounts to circumvent or avoid the single transaction purchase limit placed on the card. Violation of this guideline will result in revocation of card use/privilege Monthly Transaction Limit (Standard Min. $3,000 per department)*: Maximum total amount for purchases each month on the individual Procurement Cards (credit limit). Once the balance on the Procurement Card reaches the monthly dollar limit, subsequent purchases will be declined. Consequently, normal purchasing procedures must be used Daily Transaction Limit (Standard Min. $1,000)*: Maximum total amount for purchases each day on the individual Procurement Card. Once the daily balance on the Procurement Card is reached, subsequent purchases will be declined. Merchant Category Codes (MCC)/Restricted Vendor Page 12-5
Section 12: Procurement Cards *The standard minimum limits may vary upon the Budget Managers request and with the Senior Director for Business Services approval. Procurement Card Credit Increases Cardholders may email request for a temporary increase (within current month) at least 2 days prior to the needed timeline. The Budget Manager must be copied on the email with a justification for the increase. When requesting an increase, all posted transactions in Bank of America Works must be signed off by the Financial Clerk and Budget Manager prior to increase. Merchant Category Codes (MCC)/Restricted Vendors All vendors are assigned a Merchant Category Code (MCC) by their bank. Certain types of MCCs are prohibited and those vendors are blocked for all cardholders. These include but are not limited to liquor stores, convenience stores, bars, lounges, adult entertainment facilities, etc. Attempting to purchase from merchants/vendors that are restricted will cause the transaction to be declined. Procurement Card Maintenance and Closure All contact with Bank of America for card set up, maintenance and closure (except for reporting lost or stolen cards after hours) will be handled by the Procurement Card Specialist. The Procurement Card Specialist is required to close an account if a Cardholder: (a) moves to a new job, in which a Procurement Card is not required, (b) terminates employment or (c) for any of the following reasons, which will subject Cardholder to disciplinary action in accordance with District Policies and Procedures: The Procurement Card is used for personal or unauthorized purposes The Procurement Card is used to purchase alcoholic beverages or any substance, material, or service which violates policy, law or regulation pertaining to GPISD Cardholder/Budget Manager allows the card to be used by an unauthorized individual Cardholder/Budget Manager splits a purchase to circumvent the limitations of the Procurement Card Cardholder/Budget Manager uses another Cardholder s card to circumvent the purchase limit assigned to either Cardholder or the limitations of the Procurement Card The Cardholder fails to provide the Budget Manager with required receipts Cardholder/Budget Manager fails to provide, when requested, information about any specific purchase Cardholder/Budget Manager does not adhere to all of the Procurement Card Policies and Procedures Failure to comply or excessive compliance issues will result in permanent loss of Procurement Card privileges Fund Sources Allowed for Card Purchases Purchases using the General funds (199), Campus Activity funds (461), and Student Activity funds (865) are allowed. Please ensure budgeted funds are available prior to making a purchase with the card. Exception: Student Activity funds (865) are not allowed to purchase inventory (technology) items. Page 12-6
Fiscal Procedures Manual Education Department General Administrative Regulations (EDGAR), the new regulations from the Office of Management and Budget (OMB), codified as Title 2 of the Code of Federal Regulations (2 CFR) Part 200, were incorporated into general federal regulation on December 26, 2014. The new regulations govern all federal grants awarded by the US Department of Education (USDE) to the state or to an LEA on or after that date. Use of the Procurement Card for items to be paid with Grant funds (2XX-4XX) will only be allowed with prior approvals in place and it would have to be paid with the new Bank of America Special Revenue card. When using grant funds, Kroger and Sam s Club credit cards will be used to purchase items. An approved purchase order must be in place prior to the credit card being used. Prohibited/Improper Purchases The Procurement Card is to be used for District educational business purposes only and must not be used for any non-business or personal purchases. Any personal purchase will be considered misappropriation of District funds, which constitutes a criminal offense and must be referred to the Chief Financial Officer, Human Resources and the Superintendent. Any purchase perceived as being exorbitant or inappropriate will be questioned and, if deemed so, must be reimbursed to the District. Cardholders who violate the Procurement Card guidelines will be subject to disciplinary action, up to and including cancellation of the Procurement Card and termination of employment. The Procurement Card cannot be used to purchase the following items: Personal purchases Cash Advances Alcoholic beverages Chemicals and hazardous materials requiring special environmental reporting Fixed Assets (items valued at $5,000 or more) Inventory Items o Apple Configurator ipod o Apple TV Microsoft Office o Chromebook Monitor o Computer Desktop or Laptop Printer o Data Projector Response System o Digital Camera and Lenses Router/Switch o Document Camera Scanner o Interactive Tablet Speakers over $100.00 o Interactive Board Television o IP (Internet Protocol) Phone Wireless Access Point o ipad or Other Manufacturer s Tablet Inventory Items will only be authorized by obtaining appropriate approvals from the Technology Department in advance. See Section 11: Fixed Assets & Inventory Items for additional details. Page 12-7
Section 12: Procurement Cards Submitting Appropriate Supporting Documentation Receipts/Proof of Purchase It is the cardholder s responsibility to obtain itemized sales receipts, internet/e-mail confirmations (e-receipts) or packing lists for all purchases using the Procurement Card for submission. Acceptable receipts contain: Vendor/merchant name Date of transaction Clear description of the items and the number of items being purchased Detailed cost of the order which includes delivery charges Unacceptable receipts include: Receipts without item description Receipts with vague item descriptions such as gen mdse, misc., tax exempt item, item 1, product numbers and serial numbers Receipts without vendor name, date of transaction and amount paid to vendor NOTE: If a receipt is lost or is not itemized, it is the Budget Manager/Cardholder s responsibility to obtain a duplicate copy from the vendor. If the Cardholder is unable to obtain a copy of the receipt, the Budget Manager/Cardholder will be required to reimburse the District with their personal funds for the unsupported transactions. Staff Development Meetings When purchasing meals for a staff development, working lunch or for student groups, appropriate documentation needs to be provided to substantiate the need. For staff development or meetings, the following documents must be submitted: An agenda identifying the business purpose A roster or sign in sheet for those in attendance is required All meals must be kept at or under the travel per diem rates which are $10.00 for breakfast and $15.00 for lunch per person. Meals served to students should be substantiated with the educational purpose and a student roster or sign in sheet of students in attendance. The Procurement Card is not to be used for offsite meetings. Staff Appreciation Purchases made for staff appreciation are subject to the maximum amounts set annually for each campus and/or department (see Section 4: Purchasing for annual limits). Purchases for staff appreciation must be supported with the description of the purpose and the recipients name(s). Page 12-8
Fiscal Procedures Manual Other Supporting Documentation Once original receipts are submitted in Bank of America Works other supporting documentation or additional information may be requested to complete the Procurement Card transaction. Checking and Verifying Card Balances Verifying Card Balances (Exhibit 12-04) demonstrates how to check your card balance in Bank of America Works. Monthly Reconciliation and Submission of Monthly Statement Financial Clerks should reconcile pending transactions listed in Bank of America Works and attach corresponding receipts and other supporting documentation within seven (7) business days of the purchase date. Allocation details must be filled out completely in Bank of America Works, stating the budget code and description of purchase including the educational purpose. When required, other supporting documentation may be necessary for meals, staff appreciation, student incentives, or any other activity deemed necessary. Bank of America sends out daily notifications of outstanding or flagged transactions to all users. Discrepancies between the receipts and statement should be resolved between the Cardholder/Budget Manager and Vendor. The original receipts must be sent to the Procurement Card Specialist on a monthly basis along with the Bank of America Statement. The reconciler should maintain copies of statements and receipts sent into the Procurement Card Specialist. Compliance Monitoring Purchasing Department verifies that internal controls are in place for use of standard practices. All pending transactions must be cleared within ten (10) days of the following month from which the transaction occurred. If transactions are not cleared this will result in suspensions of Procurement Card use. Audit The District reserves the right to perform periodic audits of cardholder's transactions to ensure compliance with this policy. Records are subject to audit by state and federal auditors, funding agencies, grantors, and other governmental agencies with funding jurisdiction. The Procurement Card Specialist shall make records and supporting documentation available to authorized requestors. Cardholders/Budget Managers who violate District Policies and Procedures will be subject to disciplinary action up to and including termination, and immediate payment of all unauthorized purchases. Page 12-9
Section 12: Procurement Cards Procurement Card Protection Security and Storage Cardholders should always treat the District Procurement Card with at least the same level of care as one does their own personal credit cards. The card should be maintained in a secure location and the card account number should be carefully guarded. Lost, Stolen, or Damaged Procurement Cards Cards that are lost, stolen, or damaged must be reported immediately to Bank of America Customer Service at (888) 449-2273. Bank of America representatives are available to assist you 24 hours a day, 365 days a year. Be sure to notify the Procurement Card Specialist and Budget Manager about the lost, stolen, or damaged card as soon as possible. Erroneous Declines There may be certain situations when a vendor receives a decline message when processing your Procurement Card transaction. If the reason for the decline is unknown, contact the Procurement Card Specialist for an explanation. Returns and Credits Contact the vendor for instructions on returning items purchased with the Procurement Card. Document the return date and personnel assisting with the return. Maintain documentation of all credits, returns and exchanges to be attached as supporting documentation in Bank of America Works. The vendor should issue a credit to your Procurement Card account for any item that they have agreed to accept for return. This credit will appear on a subsequent statement. Procurement Card account. Disputes and Billing Errors Under no circumstances should cash be accepted in lieu of a credit to the The Cardholder should always attempt to resolve any disputes or billing errors directly with the vendor. In most cases, the vendor will issue a credit to the Procurement Card account. If an agreement cannot be reached with the vendor, you should contact the Procurement Card Specialist. Sales and Use Tax The District is a tax-exempt entity and is not subject to sales tax for purchases within Texas. It is the responsibility of the Cardholder to inform the vendor that the transaction will be tax-exempt prior to processing the sale. Be sure to present the Texas Sales and Use Tax Exemption Certification Form (Exhibit 12-03) to the vendor to make them aware the District is a tax-exempt organization. If the vendor charges sales tax, the Cardholder must contact the vendor and obtain a credit or reimburse the District for sales tax charged. Do not accept cash as reimbursement to settle the sales tax error. Instruct the vendor to credit the Procurement Card that was charged. Erroneously paid tax is the responsibility of the cardholder. Page 12-10
Fiscal Procedures Manual Exhibits Exhibit 12-01: Procurement Card Log Page 12-11
Section 12: Procurement Cards Exhibit 12-02: Procurement Card Agreement Page 12-12
Fiscal Procedures Manual Exhibit 12-03: Texas Sales & Use Tax Exemption Certification Page 12-13
Section 12: Procurement Cards Exhibit 12-04: Verifying Card Balances Verifying Card Balances Step 1: Once you are logged into Bank of America, scroll down towards the Accounts Dashboard area. Click the last four digits of the card that you wish to acquire information on and select View Full Details. Step 2: You will be brought to a screen like the one below with various tabs to pick from. Select Spend Control Profile. Page 12-14
Fiscal Procedures Manual Exhibit 12-04: Verifying Card Balances (Continued) Step 3: Once on the Spend Control Profile tab you will see various information concerning the cards credit limit. This will show you what your limitations are per transactions, daily and on a monthly basis. On the top right hand corner, you see Available Credit and Current Balance. Be careful when reading those numbers, as they may not always be correct if there are any transactions outstanding that have not been posted. Step 4: Click on the Actions drop down menu and select View Auth Log. Page 12-15
Section 12: Procurement Cards Exhibit 12-04: Verifying Card Balances (Continued) Step 5: The Authorization Log should now be pulled up. This log shows any purchases that have recently been made. If anything is declined, this is the place that will provide you a reason why. Also, on the top right hand corner you will find Available Funds. This is the real time amount that shows exactly what is available to spend on you card. This amount has taken into account any transactions that have not yet posted. Page 12-16